Boca Man Charged In A Ponzi Scheme

Authorities Say He Defrauded Investors, Bought Fancy Homes

Federal prosecutors have charged a Boca Raton man in a $40 million Ponzi scheme, saying he defrauded investors while buying fancy homes and exotic sports cars.

Michael Meisner, 52, of Boca Raton, was formally charged Wednesday with a single count each of mail fraud, loan application fraud and tax evasion. He's set to appear before U.S. Magistrate Judge James Hopkins this morning in federal court in West Palm beach, where he plans to plead guilty.

"He will plead guilty at that time, a sentencing will be set and bond will be discussed," said Meisner's defense attorney, H. Scott Hecker.

Investors have been waiting more than a year for that news.

"I'm ecstatically happy that justice will be done," said Estee Gilad, of Deerfield Beach. "I did lose a considerable amount for me. My mother lost everything. She lost well over $500,000 -- her life savings."

The charges stem from a Boca Raton firm he ran from 2001 through 2008 called Phoenix Diversified Investment Corp, which promised about 260 investors minimal to no risk and steady returns through futures trading.

According to the charges, Meisner was a legitimate - albeit terrible - trader in the beginning. The $16 million he invested early turned into a $6 million deficit, the charging documents said. After that, investigators say, he used about $22 million in a Ponzi scheme by paying old investors with new investors' money.

The charges said Meisner also hid $444,581 in income and lied about his wife's income and employment when obtaining a mortgage.

While the company's finances headed south, federal prosecutors say Meisner lived the high life. They list 15 luxury cars that Meisner purchased or leased including an Aston Martin, a Ferrari 360 Spider, a Bentley GT, two Porsches and five BMWs. They said he bought eight expensive homes, went on vacations, joined country clubs, bought high-end electronics and paid for his daughter's wedding at the exclusive Mar-A-Lago Club in Palm Beach.

Those details are hard for investors to hear.

"It's infuriating that he kept living his lifestyle on our money even after all that happened," Gilad said.

In April, 2008, Meisner sent a letter to investors saying that Phoenix Diversified would shut down because it was out of money. Several investors sued and forced both Meisner and his company into bankruptcy. The U.S. Commodity Futures Trading Commission also filed a complaint against Meisner, winning a settlement that bans him from trading futures.

After Meisner pleads guilty, he'll be scheduled for sentencing in front of U.S. District Judge Kenneth Marra. He faces up to 55 years in prison, if convicted on all charges. His attorney wouldn't speculate on possible sentences, but he expects it to be considerable.

"The ultimate sentence belongs to the judge," Hecker said. "And Judge Marra is a tough judge."